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Khazanah Nasional, Malaysia's sovereign wealth fund, reported higher operating profits in 2025, with a 5.2% investment return, despite global trade and geopolitical uncertainties. Operating profits rose to 5.6 billion ringgit (USD 1.43 billion) and net assets reached 105 billion ringgit, while dividends to the government doubled. The fund, a key shareholder in Malaysia's major companies, plans to strengthen the power sector, support local semiconductor firms, and develop downstream rare earth activities. Its strategy focuses on risk diversification, sustainable growth, and long-term development of critical industries.
Malaysia's sovereign wealth fund, Khazanah Nasional, has reported stronger operating profits, achieving a 5.2% return on its investment portfolio in 2025, despite uncertainties from U.S. tariffs and geopolitical risks. The fund holds major stakes in some of the country's largest companies, including CIMB Group, Tenaga Nasional, and the national carrier, Malaysia Aviation Group. Its investments span energy, healthcare, information technology, and real estate. Advertisement
Khazanah, owned by the finance ministry, posted operating profits of 5.6 billion ringgit (USD 1.43 billion) last year, up from 5.1 billion ringgit in 2024. Its net assets increased to 105 billion ringgit from 103.6 billion ringgit, while the annual dividend to the government doubled to 2 billion ringgit in 2025, reflecting the fund's stronger performance.
Managing Director Amirul Feisal Wan Zahid said Malaysia's growth remained resilient, supported by both private and foreign investments. The country's economy grew by 4.9% in 2025, surpassing official projections, according to advance government estimates. He added that for 2026, Khazanah would accelerate the execution of its Malaysia-focused and global investment strategies, emphasizing diversification across asset classes and geographies.
Earlier this year, Khazanah announced plans to channel more capital into strengthening the country's power system and supporting local semiconductor companies, aligning with growth in artificial intelligence and technology sectors. The fund is also tasked with developing downstream activities in the rare earths sector through international collaborations.
Malaysia holds an estimated 16.1 million tons of rare earth deposits and aims to develop the local industry. However, the country currently lacks the expertise and technology to mine and process the minerals essential for defense equipment, electric vehicles, and other high-value products. Last year, reports indicated discussions between Malaysia and China for a potential partnership to develop a rare earths refinery, but Khazanah noted that creating a complete rare earth ecosystem would require significant time. Amirul Feisal emphasized that many deposits are still unverified and that extraction is subject to environmental regulations, policy considerations, and validation work before development can proceed.
Source Reuters
5th Jun, 2025
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